Room for Savings: Optimizing Hotel Spend - Carlson

Chain-wide deals tend to offer smaller discounts
than individually negotiated rates, but they
enable travel managers to extend the benefits
of a preferred hotel program to destinations
where spend volumes are too low for propertylevel
negotiations, and to do so with minimal
resources.
Companies with highly dispersed travel
patterns will therefore find chain-wide deals
particularly useful. In the examples shown in
Figure 76, Company AG is able to cover most of
its spend through individual property deals.
Company B, on the other hand, has spend
spread out over many more locations and has
therefore negotiated agreements with four
chains in the United States, in addition to
property-level deals with 140 hotels. Thanks to
those chain deals, an additional 44 percent of
room nights can be discounted. An analysis of
the company’s spend in six cities shows that
chain hotels account for up to 35 percent of
room nights at those destinations. Further
analysis of spend at two destinations shows that
the average room rate paid at preferred chains is
6 percent higher than that paid at individual
preferred properties (Figures 77-78).
Figure 76: Chain-wide deals are particularly useful for companies with highly dispersed
travel patterns
Company AG
65% of spend = 11 locations
Company B
65% of spend = 60 locations
Mostly preferred property agreements
Preferred property agreements & chain-wide deals
30% of the company’s U.S. hotel spend 1% of the company’s U.S. hotel spend
Source: CWT Travel Management Institute
Based on transaction data